Government yesterday signed a joint venture agreement with the world's top diamond producer by volumes, Alrosa Overseas SA, for the exploration, extraction and marketing of diamonds, in a development expected to transform the country's diamond sector.
The move is an endorsement of President Mnangagwa's robust drive to attract investment in a bid to turn around the economy.
Zimbabwe Consolidated Diamond Company (ZCDC), a Government diamond mining firm, signed the agreement with Alrosa in a development expected to boost diamond production and thrust the sector on the path to attaining 10 million carats by 2023.
Alrosa chief executive officer Mr Sergey Ivanov and ZCDC chairman Mr Kilian Ukama signed the agreement in Harare yesterday at a ceremony witnessed by President Mnangagwa.
Russian Ambassador to Zimbabwe Mr Sergey Bakharev and several Cabinet ministers also attended.
The joint venture will be for the mining and exploration of claims and special grants registered under ZCDC and others which may be acquired by the joint venture company.
The latest deal comes after a Chinese firm, Anjin Investments, was recently relicensed to extract gems in Chiadzwa as Government seeks to exploit its minerals in line with the Transitional Stabilisation Programme (TSP) and Diamond Policy.
Speaking after the signing ceremony, President Mnangagwa described the agreement as yet another milestone in the "Zimbabwe is Open for Business Policy", which is critical in the new dispensation's drive towards the attainment of "Vision 2030" of an upper middle income economy.
"The signing of this joint venture agreement between the ZCDC and Alrosa bears testimony of the successes that this policy is yielding, to date," said President Mnangagwa.
"This is demonstrated by Government's commitment to welcome and facilitate investments from across the world, which create mutual benefits, jobs and ultimately results in the improved quality of life of our people."
The historic event follows President Mnangagwa's State visit to Russia in January this year where he held talks with President Vladmir Putin.
President Mnangagwa said the Moscow Stock Exchange-listed company accounts for 29 percent of the global diamond production by volume, adding that it is reputed for cutting edge technology for all processes along the diamond value chain.
"After extensive negotiations, ZCDC and Alrosa have agreed to a mutually beneficial partnership in diamond exploration, mining and marketing; as well as both greenfield and brownfield exploration and mining projects," he said.
Under the agreement, Alrosa will release about US$12 million for diamond exploration in the country.
President Mnangagwa said the ensuing exploration efforts are expected to culminate in the discovery of more diamond deposits for development into operational mines that will significantly contribute to total diamond production output and related value chain products in Zimbabwe.
"I am, thus, confident that the joint venture signed here today (yesterday) will enhance skills and technological transfer as well as create income and empowerment opportunities in the respective mining communities and Zimbabwe as a whole," he said.
President Mnangagwa reassured both Alrosa and ZCDC that Government would guarantee the success of the joint venture partnership.
ZCDC's Mr Ukuma said the signing of the agreement marks the beginning of a partnership that will enable Zimbabwe to become one of the top five rough diamond producers in the world in the next five years.
"Alrosa has a proven track record as a joint venture partner in the region and globally. This will create more value for the country, Government and other stakeholders resulting in the rapid development and growth of the national economy in line with Government's Vision 2030.
"This joint venture will yield significant benefits to the communities and the nation through employment creation, generation of foreign currency, contribution to te fiscus, enterprise development and upliftment of communities," said Mr Ukama.
He said attainment of 10 million carats and US$1 billion from the diamond industry by 2030 remains their target.
Mr Ivanov said they were grateful to President Mnangagwa for inviting them to participate in diamond exploration and mining in Zimbabwe, adding that they will not only produce diamonds, but also also bring value.
"We are very grateful to your personal support and involvement to make this joint venture a success," he said.
Speaking during the post-Cabinet briefing yesterday, Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa said Cabinet considered and approved the Memorandum of Agreement between ZCDC and Alrosa as submitted by Finance and Economic Development Minister Professor Mthuli Ncube.
Alrosa has already advanced US$1,6 million for the operationalisation of the joint venture and pledged to avail other funding needs as equity for mining development and equipment acquisition.
She said benefits from the partnership will include access to advanced exploration and mining technology and technical capacity under the command of Alrosa.
Minister Mutsvangwa said the agreement would also see the mitigation of constraints in the diamond sector such as limited market development, diversity and depth; and unlocking the huge diamond sector potential, which will ensure significant contribution to fiscus, foreign currency generation, job creation and general economic development.